Locations, damned locations and Narsaq

Daily Parse | One of Greenland’s most promising mines could hardly be in a worse location

Out of sight. Top of mind (Photo: GME)

Kevin McGwin

When Greenland Minerals and Energy, an Australia-listed mining firm, describes its one and only project, one of the things it frequently highlights, beyond the vast richness of its deposits of rare earths, is its location: “favourable country and project location with direct shipping access, international airport nearby”, boasts the firm’s most recent annual report.

What is harder to find in the promotional literature is the mine’s proximity to Narsaq, a prospering town of 1,500. Located less than 10 kilometres downhill from the site of the proposed Kvanefjeld mine, Narsaq is ideally situated to reap the benefits of operations there: out of sight of the proposed mine’s open-pit facility but not out of commuting distance.

Getting an operation the size and stature of Kvanefjeld off the ground after more than a decade would be a morale-booster for Greenland’s mining authorities, too. Kvanefjeld would create some 800 jobs and give Greenland the world’s second-largest producer of rare earths, a category of mineral used to produce the magnets used in modern high-tech products. This, at time when the country’s fledgling mining industry has been painstakingly slow to get off the ground.

That Narsaq is not mentioned may be more than a mere oversight, however. Kvanefjeld would also be the world’s fifth-largest producer of uranium, and the town’s downwind location has raised fears amongst some residents that activity there would send clouds of radioactive dust over it, fouling Greenland’s only agricultural region and a promising destination for anglers.

Complicating matters further, Unesco, the UN culture agency, has placed a number of sites in the area on its World Heritage list. This, though, need not be a hindrance, suggests Kiista Isaksen, the town’s mayor. The area, she believes, is big enough for both types of activities, though she admits that if GME and other miners process their ores on site, as is required under current regulations, visitors might be turned off.

As a mineral site, Kvanefjeld’s richness is unparalleled, say geologists. GME itself describes it as perhaps the largest multi-element deposit of its kind anywhere. This, however, is also its public-relations Achilles heel: thanks to the geological make-up of the area, it is impossible to mine its rare earths without a by-production of other materials, including zinc, fluorspar and, most problematic, uranium.

To date, GME has invested in excess of $450 million in preparation for opening the facility and survived multiple political challenges to the project, including a 2013 bill to permit uranium mining that passed Inatsisartut, the national assembly, by a single vote.

A 2016 vote to permit uranium exports easily passed the Danish legislature, but not without considerable discussion of whether Copenhagen would use the vote as a pretext for clawing back control over Greenland’s underground.

Later that year, a major Chinese investment ruffled some feathers in Nuuk and, in particular, Copenhagen. Even with these concerns, the mine has the full backing of the newly elected government in Nuuk, which explicitly states in its plan for the next four years that it approves of uranium mining as a by-product of rare-earths mining (though no firm is mentioned by name).

The next step will be for GME to submit environmental and social impact assessments to lawmakers, which it expects to do in June. If they are approved, the assessments will be subject to public consultation before mining authorities can decide whether to grant final approval.

For now, they remain stuck between Narsaq and a hard place.



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